Avoid These Top 4 Inventory Mismanagement Mistakes
A sloppy inventory management system can bring an otherwise successful business to a standstill. Being able to know exactly what you have, and what you need to have, on hand will help business flow smoothly – and ensure that you are always able to keep customers satisfied and meet demands.
If you are trying to figure out ways to maximize the efficiency of your inventory management, below are four inventory mismanagement mistakes to avoid:
Not investing in a self-storage unit
Many business owners, especially small business owners, try and do too much with what little space they have. In addition to running the administrative and day-to-day business operations from one office, or area of their home, they also try to store all of their inventory in the same place. This is a recipe for clutter and mismanagement. One of the best things you can do as a business owner is to outsource your inventory storage to a self storage facility.
Even if you are running a comparatively small business, having an inventory management system, especially one that is online and backed up by the cloud, not only offers peace of mind but eliminates the painful manual work and reduces your chances for human error, including miscalculation. A miscalculation can end up causing you to order more or less than you actually need.
Train your employees
Many people make the mistake of assuming that their employees will just be able to intuitively understand how the inventory management system works. Every business owner takes a slightly different approach to inventory management, and focuses on certain areas more than others. Making sure your employees know what is important to you, how to use the technology you have implemented, and what areas to pay close attention to will help you avoid errors among your employees.
It is important to always know what you are selling the most of and at what times of the year you are selling it. Just-in-time ordering best practices (where inventory is ordered with just enough lead-time to fill an order) is also a good way to ensure that you are not burning your cash flow on unnecessary amounts of inventory throughout the year.
Inventory management is a vital component of any business, big or small. It takes some time and some careful planning to set up a good inventory management system, but if you keep the above advice in mind, you should be able to avoid some of the biggest inventory mismanagement pitfalls.